Singapore’s central bank maintained its existing pace of currency appreciation, forgoing stimulus as inflation risks curb scope to revive a shrinking economy.
Gross domestic product fell an annualized 1 percent in the three months through September from the previous quarter, when it expanded a revised 16.9 percent, the trade ministry said in a statement today. The median in a Bloomberg News survey of 13 economists was for a 4 percent contraction. The central bank, which uses the island’s dollar to manage inflation, said it will maintain a modest and gradual appreciation of the currency.
Singapore has resisted monetary easing since October 2011 as a tight labor market and record homes prices fueled inflation pressures. The International Monetary Fund has cut its global outlook for this year and next as capital outflows add to risks for emerging markets, and policy makers around the world are watching for a resolution to the U.S. fiscal policy deadlock that’s threatening the world economy.
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